If the Present Value of the Lease Payments Is 90

Multiple Choice

If the present value of the lease payments is 90% or more of the market value of the leased asset, the:

A) lease is not cost-effective and should be cancelled.
B) lease may be classified as an operating lease.
C) one of the criteria is met for the lease to be considered a capital lease.
D) lease may be recorded off-balance sheet.